How Much SIP You Need to Reach 1 crore?
This article helps you calculate how much you will need to invest every month to reach the first significant portfolio milestone of ₹ 1 crore by investing in mutual funds.
How Much SIP You Need to Reach 1 crore?
Posted on 29 Nov 2025
Author: Sayan Sircar
42 mins read
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This article helps you calculate how much you will need to invest every month to reach the first significant portfolio milestone of ₹ 1 crore by investing in mutual funds.
📚 Table of Contents
- How Much SIP You Need to Reach ₹1 Crore (with Scenarios for 5, 10 and 15 Years)
- Introduction: Why ₹1 Crore Is a Common Wealth Milestone
- What Determines the SIP Amount Needed To Reach a Target Goal Amount?
- Summary Table: SIP Amount Needed to Reach ₹1 Crore
- Arthgyaan SIP Calculator for Target Amount
- How to use the Arthgyaan SIP Calculator for Target Amount?
- How to understand the results of the Arthgyaan SIP Calculator for Target Amount?
- Which Mutual Funds are Best for Reaching ₹1 crore Corpus?
- How Much Return Can You Expect from Mutual Funds?
- How Much does the SIP Amount Vary as per Return Expectations?
- What is the Role of Step-Up SIP in Reaching ₹1 Crore?
- SIP vs. Lump sum: Which is Better for Reaching your First Crore?
- How Inflation Changes the Real Value of ₹1 Crore?
- Conclusion: How to Create and Manage a Portfolio to Reach ₹1 crore?
How Much SIP You Need to Reach ₹1 Crore (with Scenarios for 5, 10 and 15 Years)
Introduction: Why ₹1 Crore Is a Common Wealth Milestone
₹1 crore is the first wealth milestone, after the previous ones of ₹1 lakh and ₹10 lakhs, where the power of compounding starts to be felt.
For example, if you have ₹1 crore today, just a ₹27,237/month SIP will get you to ₹2 crore in 5 years at 12%. Out of that ₹2 crores, around ₹26.40 lakhs would have come from the SIP, while the remaining ₹1.74 crore would have come from the starting ₹1 crore.
In this article, we will cover how to reach your first ₹1 crore by investing in Mutual Funds by SIP.
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What Determines the SIP Amount Needed To Reach a Target Goal Amount?
To understand how to find the SIP amount, we will take the example of driving from Kashmir to Kanyakumari. Using Google Maps data,
| Metric | Car Travel | Investment Goal |
|---|---|---|
| Target | 3,600 Km | ₹ 1 crore |
| Time | 8 days with 9hr/day driving |
8 years with 12% return/year |
| Effort | 50 Km/hr average speed |
₹63,674/month |
For the investment, we need:
- how long you are planning to invest to reach ₹1 crore
- how much returns you are expecting (12%/year on an average is reasonable as per historical data)
- how consistently you are investing (stepping up the investment amount along with salary increases will make you reach your goal faster)
Summary Table: SIP Amount Needed to Reach ₹1 Crore
In the cases below, we will assume 12% return from investment and 10% annual step-up in the SIP amount.
| Years | Monthly SIP Amount |
Total investment (lakhs) |
|---|---|---|
| 5 | ₹1,03,000 | ₹75.59 |
| 6 | ₹77,438 | ₹71.70 |
| 7 | ₹59,836 | ₹68.12 |
| 8 | ₹47,143 | ₹64.70 |
| 9 | ₹37,723 | ₹61.47 |
| 10 | ₹30,594 | ₹58.51 |
| 11 | ₹25,015 | ₹55.63 |
| 12 | ₹20,642 | ₹52.97 |
| 13 | ₹17,176 | ₹50.54 |
| 14 | ₹14,351 | ₹48.17 |
| 15 | ₹12,105 | ₹46.15 |
If you are investing to reach ₹1 crore via safe investments like Recurring Deposits (RD), then you need ₹60,940/month (vs. ₹30,594/month via SIP) to reach ₹1 crore in 10 years assuming 5%/year post-tax returns in RD.
To see how this works with your portfolio, you can use the Arthgyaan SIP Calculator for Target Amount
Arthgyaan SIP Calculator for Target Amount
Our How Much SIP You Need to Reach 1 crore? calculator allows you to know how much you should invest via SIP to reach a specific target corpus amount say ₹1 crore. For example:
- invest ₹44,632/month to reach ₹1 crore in 10 years at 12% returns
- invest ₹30,594/month to reach ₹1 crore in 10 years at 12% returns and 10% step-up
- invest around ₹27,135/month to reach ₹1 crore in 10 years via large-cap funds and 10% step-up etc.
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Get a sample SIP portfolio by email:
● Required Investment● Expected Returns
Required Monthly SIP (₹):
Total Investment (₹):
Target Value (₹):
Inflation-Adjusted Value (₹):
If you found this useful, check out the Arthgyaan step-up SIP calculator.Also try out our Monte Carlo simulation-based FIRE calculator.
If you are looking to understand how to best manage your mutual fund portfolio, you can get a free Mutual fund portfolio review.
How to use the Arthgyaan SIP Calculator for Target Amount?
You need to enter just these numbers to get started with the Arthgyaan SIP Calculator for Target Amount calculator:
- Target Amount: This is the amount of wealth you plan to create
- Starting Lump Sum: This is the money that you already have as a lump sum. You will invest this either immediately or over the next few months. But you need to include that as the starting value. If you don’t have this amount already, leave it as zero
- Time Period (Years): Your step-up SIP will run for these many years
These inputs are optional and can be left as-is
- Annual Step-Up: This is the step-up amount. You will increase the SIP amount by this amount next year
- Expected Rate of Return: Enter the return you think you will get. 12% is a typical number but it will vary year-on-year
- Inflation Rate: This is how much the value of the corpus will reduce due to inflation (prices of things going up over time). This will give you a more realistic value of how much you will make in today’s money
How to understand the results of the Arthgyaan SIP Calculator for Target Amount?
The output of the Arthgyaan SIP Calculator for Target Amount has two easy to understand parts:
- a ring chart that shows how much of the final amount comes from the money you invested vs. the return that you got
- four numbers that we now explain below
These are the numbers that have the result of the Arthgyaan SIP Calculator for Target Amount:
- Total Investment: This is the total amount that you will invest including the lump sum and the SIP
- Total Value: This is the final amount that you are expected to make that is the same as the target amount
- Inflation-Adjusted Value: This is the value after you adjust for prices going up over time. While you can create any large corpus in lakhs and crores over many years, you need to remember that overall things double in price every 10 years
- Uncertainty-Adjusted Range: Arthgyaan is proud to say that Arthgyaan calculators are the first in the industry to show the uncertainty of investing in the stock market by showing you a range of numbers for the corpus you are expected to make after adjusting for inflation. The range will change every time you recalculate
To understand more about Uncertainty-Adjusted Range, please refer to our detailed article that will help you adjust your expectations from investing in the stock market:
- The lie of wealth-creation via SIP in mutual funds
- The lie of enjoying financial freedom via SWP from mutual funds
Which Mutual Funds are Best for Reaching ₹1 crore Corpus?
The Arthgyaan SIP Calculator for Target Amount allows you to choose which type of mutual funds:
Here is the compiled result for a 10 year, 10% step-up SIP:
| Mutual Fund Category |
Monthly SIP Amount |
Total investment (lakhs) |
Risk |
|---|---|---|---|
| Small Cap | ₹37,575 | ₹51.56 | Very High |
| Mid Cap | ₹38,624 | ₹53.00 | Very High |
| Large Mid Cap | ₹42,311 | ₹58.06 | Very High |
| Large Cap | ₹42,884 | ₹58.84 | Very High |
| Aggressive Hybrid | ₹43,392 | ₹59.54 | High |
| Multi Asset Allocation | ₹44,918 | ₹61.64 | High |
| Gold | ₹49,750 | ₹68.27 | High |
| Conservative Hybrid | ₹51,785 | ₹71.06 | Medium |
| Equity Savings | ₹51,912 | ₹71.23 | Medium |
| Gilt With 10 Year Constant Duration | ₹54,200 | ₹74.37 | Medium |
| Gilt | ₹55,154 | ₹75.68 | Medium |
| Money Market | ₹56,012 | ₹76.86 | Low |
| Liquid | ₹56,362 | ₹77.34 | Low |
| Arbitrage | ₹56,426 | ₹77.43 | Very Low |
| Overnight | ₹57,634 | ₹79.08 | Very Low |
Investors should balance the risk of various fund categories vs. the amount they need to invest. Here risk comes from the fact that mutual fund returns fluctuate due to market movements and are not guaranteed. In general, for the same amount of time allocated to reach the target of ₹1 crore:
- higher risk, lower the SIP amount
- lower risk, higher the SIP amount
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How Much Return Can You Expect from Mutual Funds?
Here is the latest data regarding mutual fund returns that will give you an estimate of what to expect based on past returns.
Equity Mutual Fund Returns
SIP
10% Step-up SIP
Lump sum
| Category | Any 1Y SIP | Any 2Y SIP | Any 3Y SIP | Any 5Y SIP | Any 7Y SIP | Any 10Y SIP |
|---|---|---|---|---|---|---|
| Equity: Large Mid Cap | 16.95% | 17.23% | 18.81% | 18.32% | 16.94% | 17.25% |
| Equity: Sectoral or Thematic | 14.83% | 17.11% | 18.42% | 17.29% | 16.21% | 16.89% |
| Equity: Flexi Cap | 15.38% | 16.17% | 16.89% | 17.05% | 16.12% | 16.38% |
| Equity: ELSS | 16.26% | 15.42% | 17.34% | 17.17% | 16.17% | 16.52% |
| Equity: Large Cap | 14.51% | 13.98% | 15.09% | 14.9% | 14.51% | 14.98% |
| Equity: Value | 16.01% | 18.56% | 19.45% | 17.3% | 15.88% | 16.86% |
| Equity: Mid Cap | 21.19% | 19.79% | 22.41% | 21.03% | 19.61% | 19.7% |
| Equity: Multi Cap | 16.16% | 19.19% | 19.82% | 20.12% | 18.86% | 18.52% |
| Equity: Contra | 17.95% | 18.13% | 18.95% | 19.42% | 18.4% | 19.53% |
| Equity: Dividend Yield | 13.58% | 17.44% | 18.98% | 17.44% | 16.53% | 17.92% |
| Equity: Focused | 16.02% | 16.42% | 17.6% | 16.88% | 15.62% | 16.09% |
| Category | Any 1Y SIP | Any 2Y 目↑ SIP | Any 3Y 目↑ SIP | Any 5Y 目↑ SIP | Any 7Y 目↑ SIP | Any 10Y 目↑ SIP |
|---|---|---|---|---|---|---|
| Equity: Large Mid Cap | 16.95% | 17.17% | 18.73% | 18.4% | 17.23% | 17.59% |
| Equity: Sectoral or Thematic | 14.83% | 17.03% | 18.38% | 17.44% | 16.57% | 17.29% |
| Equity: Flexi Cap | 15.38% | 16.11% | 16.78% | 17.15% | 16.28% | 16.64% |
| Equity: ELSS | 16.26% | 15.31% | 17.25% | 17.26% | 16.42% | 16.79% |
| Equity: Large Cap | 14.51% | 13.91% | 15.04% | 14.95% | 14.74% | 15.2% |
| Equity: Value | 16.01% | 18.58% | 19.31% | 17.62% | 16.36% | 17.24% |
| Equity: Mid Cap | 21.19% | 19.7% | 22.35% | 21.23% | 20.05% | 20.14% |
| Equity: Multi Cap | 16.16% | 19.12% | 19.7% | 20.32% | 19.33% | 18.95% |
| Equity: Contra | 17.95% | 18.06% | 18.85% | 19.66% | 18.92% | 19.9% |
| Equity: Dividend Yield | 13.58% | 17.39% | 18.9% | 17.79% | 17.15% | 18.37% |
| Equity: Focused | 16.02% | 16.38% | 17.5% | 16.89% | 15.86% | 16.31% |
| Category | Any 1Y | Any 2Y | Any 3Y | Any 5Y | Any 7Y | Any 10Y |
|---|---|---|---|---|---|---|
| Equity: Large Mid Cap | 14.88% | 19.51% | 18.39% | 17.95% | 15.51% | 16.35% |
| Equity: Sectoral or Thematic | 13.07% | 19.97% | 17.57% | 16.31% | 14.69% | 15.51% |
| Equity: Flexi Cap | 14.51% | 19.15% | 16.91% | 16.66% | 14.92% | 15.59% |
| Equity: ELSS | 15.1% | 17.97% | 16.89% | 16.5% | 14.9% | 15.94% |
| Equity: Large Cap | 12.89% | 16.5% | 14.9% | 14.68% | 13.49% | 14.18% |
| Equity: Value | 15.67% | 20.56% | 18.65% | 15.31% | 14.25% | 15.89% |
| Equity: Mid Cap | 20.37% | 23.85% | 21.89% | 19.57% | 17.81% | 19.1% |
| Equity: Multi Cap | 15.31% | 22.45% | 19.93% | 18.54% | 16.45% | 16.95% |
| Equity: Contra | 16.66% | 20.55% | 18.24% | 16.97% | 16.74% | 17.88% |
| Equity: Dividend Yield | 12.54% | 20.19% | 17.86% | 14.02% | 14.33% | 15.51% |
| Equity: Focused | 14.91% | 19.11% | 17.45% | 17.78% | 14.76% | 15.76% |
Debt Mutual Fund Returns
SIP
10% Step-up SIP
Lump sum
| Category | Any 1Y SIP | Any 2Y SIP | Any 3Y SIP | Any 5Y SIP | Any 7Y SIP | Any 10Y SIP |
|---|---|---|---|---|---|---|
| Debt: Medium To Long Duration | 8.05% | 8.23% | 7.76% | 7.14% | 7.03% | 7.06% |
| Debt: Liquid | 6.04% | 5.91% | 5.69% | 5.2% | 5.81% | 5.99% |
| Debt: Gilt | 8.38% | 8.51% | 8.07% | 7.54% | 7.36% | 7.55% |
| Debt: Medium Duration | 8.31% | 8.12% | 7.76% | 6.93% | 6.61% | 7.09% |
| Debt: Money Market | 7.31% | 7.19% | 7.07% | 6.58% | 6.36% | 6.48% |
| Debt: Long Duration | 8.68% | 8.46% | 7.74% | 7.46% | 7.19% | 7.41% |
| Debt: Dynamic Bond | 8.14% | 8.15% | 7.74% | 7.29% | 7.13% | 7.37% |
| Debt: Low Duration | 7.8% | 7.71% | 7.44% | 6.87% | 6.57% | 6.73% |
| Debt: Corporate Bond | 7.85% | 7.81% | 7.46% | 7.07% | 7.08% | 7.33% |
| Debt: Ultra Short Duration | 7.36% | 7.06% | 6.85% | 6.56% | 6.32% | 6.28% |
| Debt: Banking And PSU | 7.86% | 7.75% | 7.53% | 7.15% | 6.95% | 7.14% |
| Debt: Overnight | 5.7% | 5.79% | 5.75% | 5.75% | 5.34% | 5.37% |
| Debt: Gilt Fund With 10 Year Constant Duration | 8.96% | 8.7% | 8.2% | 7.5% | 7.07% | 7.61% |
| Debt: Floater | 7.86% | 7.84% | 7.59% | 7.27% | 7.1% | 7.22% |
| Debt: Short Duration | 8.06% | 7.96% | 7.67% | 7.22% | 6.85% | 7.06% |
| Debt: Credit Risk | 8.61% | 8.99% | 7.84% | 7.01% | 6.65% | 7.42% |
| Category | Any 1Y SIP | Any 2Y 目↑ SIP | Any 3Y 目↑ SIP | Any 5Y 目↑ SIP | Any 7Y 目↑ SIP | Any 10Y 目↑ SIP |
|---|---|---|---|---|---|---|
| Debt: Medium To Long Duration | 8.05% | 8.21% | 7.75% | 7.12% | 7.06% | 7.02% |
| Debt: Liquid | 6.04% | 5.91% | 5.7% | 5.23% | 5.83% | 5.98% |
| Debt: Gilt | 8.38% | 8.49% | 8.06% | 7.5% | 7.33% | 7.44% |
| Debt: Medium Duration | 8.31% | 8.11% | 7.75% | 6.96% | 6.64% | 7.11% |
| Debt: Money Market | 7.31% | 7.19% | 7.08% | 6.59% | 6.37% | 6.44% |
| Debt: Long Duration | 8.68% | 8.41% | 7.7% | 7.48% | 7.18% | 7.25% |
| Debt: Dynamic Bond | 8.14% | 8.14% | 7.75% | 7.29% | 7.13% | 7.31% |
| Debt: Low Duration | 7.8% | 7.71% | 7.44% | 6.9% | 6.56% | 6.69% |
| Debt: Corporate Bond | 7.85% | 7.81% | 7.46% | 7.07% | 7.07% | 7.26% |
| Debt: Ultra Short Duration | 7.36% | 7.06% | 6.87% | 6.6% | 6.33% | 6.24% |
| Debt: Banking And PSU | 7.86% | 7.74% | 7.54% | 7.17% | 6.92% | 7.08% |
| Debt: Overnight | 5.7% | 5.79% | 5.78% | 5.82% | 5.38% | 5.35% |
| Debt: Gilt Fund With 10 Year Constant Duration | 8.96% | 8.7% | 8.18% | 7.53% | 6.98% | 7.51% |
| Debt: Floater | 7.86% | 7.85% | 7.6% | 7.3% | 7.1% | 7.17% |
| Debt: Short Duration | 8.06% | 7.96% | 7.67% | 7.24% | 6.85% | 7.02% |
| Debt: Credit Risk | 8.61% | 9.0% | 7.84% | 7.05% | 6.7% | 7.49% |
| Category | Any 1Y | Any 2Y | Any 3Y | Any 5Y | Any 7Y | Any 10Y |
|---|---|---|---|---|---|---|
| Debt: Medium To Long Duration | 8.09% | 8.18% | 7.63% | 7.14% | 7.24% | 7.53% |
| Debt: Liquid | 6.04% | 5.9% | 5.54% | 5.02% | 5.89% | 6.43% |
| Debt: Gilt | 8.24% | 8.47% | 8.1% | 7.86% | 7.95% | 8.28% |
| Debt: Medium Duration | 8.18% | 8.25% | 7.73% | 6.8% | 6.96% | 7.59% |
| Debt: Money Market | 7.33% | 7.08% | 6.89% | 6.35% | 6.54% | 6.93% |
| Debt: Long Duration | 8.95% | 8.86% | 7.98% | 7.54% | 8.49% | 8.3% |
| Debt: Dynamic Bond | 8.06% | 8.11% | 7.69% | 7.33% | 7.59% | 7.95% |
| Debt: Low Duration | 7.8% | 7.66% | 7.38% | 6.74% | 6.78% | 7.17% |
| Debt: Corporate Bond | 7.87% | 7.8% | 7.36% | 7.22% | 7.48% | 7.83% |
| Debt: Ultra Short Duration | 7.29% | 6.87% | 6.64% | 6.32% | 6.59% | 6.84% |
| Debt: Banking And PSU | 7.89% | 7.71% | 7.52% | 7.31% | 7.43% | 7.6% |
| Debt: Overnight | 5.59% | 5.34% | 5.14% | 5.0% | 5.23% | 5.9% |
| Debt: Gilt Fund With 10 Year Constant Duration | 8.89% | 8.77% | 8.56% | 8.18% | 8.06% | 8.32% |
| Debt: Floater | 7.88% | 7.7% | 7.23% | 7.08% | 7.33% | 7.61% |
| Debt: Short Duration | 8.05% | 8.02% | 7.63% | 7.04% | 7.17% | 7.59% |
| Debt: Credit Risk | 8.52% | 8.73% | 7.92% | 6.67% | 6.96% | 7.78% |
Hybrid Mutual Fund Returns
SIP
10% Step-up SIP
Lump sum
| Category | Any 1Y SIP | Any 2Y SIP | Any 3Y SIP | Any 5Y SIP | Any 7Y SIP | Any 10Y SIP |
|---|---|---|---|---|---|---|
| Hybrid: Aggressive | 13.87% | 14.2% | 15.23% | 15.43% | 14.53% | 14.5% |
| Hybrid: Conservative | 9.68% | 9.85% | 9.6% | 8.68% | 8.46% | 8.76% |
| Hybrid: Equity Savings | 10.09% | 10.07% | 10.14% | 9.83% | 9.57% | 9.1% |
| Hybrid: Balanced | 7.56% | 6.02% | 12.76% | 12.31% | 11.87% | 12.54% |
| Hybrid: Arbitrage | 6.78% | 6.63% | 6.53% | 6.27% | 5.97% | 6.26% |
| Category | Any 1Y SIP | Any 2Y 目↑ SIP | Any 3Y 目↑ SIP | Any 5Y 目↑ SIP | Any 7Y 目↑ SIP | Any 10Y 目↑ SIP |
|---|---|---|---|---|---|---|
| Hybrid: Aggressive | 13.87% | 14.15% | 15.17% | 15.52% | 14.74% | 14.73% |
| Hybrid: Conservative | 9.68% | 9.83% | 9.58% | 8.68% | 8.53% | 8.84% |
| Hybrid: Equity Savings | 10.09% | 10.06% | 10.11% | 9.9% | 9.67% | 9.25% |
| Hybrid: Balanced | 7.56% | 6.16% | 12.72% | 12.35% | 12.0% | 12.7% |
| Hybrid: Arbitrage | 6.78% | 6.63% | 6.54% | 6.32% | 5.97% | 6.29% |
| Category | Any 1Y | Any 2Y | Any 3Y | Any 5Y | Any 7Y | Any 10Y |
|---|---|---|---|---|---|---|
| Hybrid: Aggressive | 13.23% | 15.69% | 14.84% | 14.49% | 13.17% | 13.78% |
| Hybrid: Conservative | 9.52% | 10.24% | 9.42% | 8.42% | 8.39% | 9.0% |
| Hybrid: Equity Savings | 9.71% | 10.85% | 9.88% | 9.49% | 8.76% | 8.56% |
| Hybrid: Balanced | 8.26% | -2.16% | 12.81% | 12.7% | 11.84% | 12.3% |
| Hybrid: Arbitrage | 6.78% | 6.52% | 6.28% | 5.86% | 6.07% | 6.48% |
Your choice of funds will therefore depend on the return expectations. We have included the lump sum returns as well since it will impact the lump sum investment amount that you already have at the beginning of the investment.
How Much does the SIP Amount Vary as per Return Expectations?
In this table, we show how much the SIP amount changes based on the return expectations of the chosen fund for a 10% step-up SIP for reaching ₹1 crore in 10 years
| Return | Monthly SIP Amount |
Total investment (lakhs) |
Return (lakhs) |
|---|---|---|---|
| 5% | ₹42,038 | ₹80.40 | ₹ 19.60 |
| 6% | ₹40,207 | ₹76.90 | ₹ 23.10 |
| 7% | ₹38,478 | ₹73.59 | ₹ 26.41 |
| 8% | ₹36,748 | ₹70.28 | ₹ 29.72 |
| 9% | ₹35,121 | ₹67.17 | ₹ 32.83 |
| 10% | ₹33,544 | ₹64.15 | ₹ 35.85 |
| 11% | ₹32,018 | ₹61.23 | ₹ 38.77 |
| 12% | ₹30,594 | ₹58.51 | ₹ 41.49 |
| 13% | ₹29,221 | ₹55.88 | ₹ 44.12 |
| 14% | ₹27,847 | ₹53.26 | ₹ 46.74 |
| 15% | ₹26,576 | ₹50.83 | ₹ 49.17 |
It is very important to note how much less investment is required if the return expectation increases. Of course, the higher return you expect, the higher is the expected fluctuations due to market movements.
What is the Role of Step-Up SIP in Reaching ₹1 Crore?
All of these are standing instructions that get executed as per a schedule you specify:
- Systematic Investment Plan (SIP): Money from a bank account is invested into a mutual fund, typically once a month
- Systematic Transfer Plan (STP): Units from a mutual fund are redeemed to invest in another mutual fund of the same AMC
- Systematic Withdrawal Plan (SWP): This is the reverse of the SIP. You sell the units from a mutual fund to send money to a bank account
A SIP is an instruction to a mutual fund to deduct from your bank account, typically every month, to invest in a mutual fund. The amount invested stays the same every month.
A step-up SIP is one where the monthly amount invested increases, say by 5% or 10%, after a year every year until you stop the SIP.
You can see how the monthly amounts in a SIP and step-up SIP change like this:
| Year | SIP | 10% Step-up SIP |
|---|---|---|
| 1 | 1,000 | 1,000 |
| 2 | 1,000 | 1,100 |
| 3 | 1,000 | 1,210 |
| 4 | 1,000 | 1,331 |
| 5 | 1,000 | 1,464 |
We have covered the basics of a step-up SIP in detail in the link below:
| Return | Fixed SIP Amount |
Step-Up SIP Amount |
Lower investment in step-up SIP |
|---|---|---|---|
| 5% | ₹64,519 | ₹42,038 | -34.84% |
| 6% | ₹61,264 | ₹40,207 | -34.37% |
| 7% | ₹58,111 | ₹38,478 | -33.79% |
| 8% | ₹55,161 | ₹36,748 | -33.38% |
| 9% | ₹52,312 | ₹35,121 | -32.86% |
| 10% | ₹49,616 | ₹33,544 | -32.39% |
| 11% | ₹47,073 | ₹32,018 | -31.98% |
| 12% | ₹44,632 | ₹30,594 | -31.45% |
| 13% | ₹42,292 | ₹29,221 | -30.91% |
| 14% | ₹40,105 | ₹27,847 | -30.56% |
| 15% | ₹38,020 | ₹26,576 | -30.10% |
The table above shows the effects of a step-up vs. fixed SIP for reaching ₹1 crore in 10 years at 12% average returns. Since a step-up SIP moves the bulk of the investment amount into the future, when income is expected to be higher, the starting SIP amount is much lower vs. a fixed SIP.
SIP vs. Lump sum: Which is Better for Reaching your First Crore?
The short answer is that both are important. If you have a chunk of money already invested, that is the lump sum that enters the calculation. If you have not yet invested that lump sum into mutual funds, you can do so either at one go, or if it makes you feel better, split that into 6-12 equal parts and invest into the chosen funds.
| Fund | Any 5Y | Any 7Y | Any 10Y |
|---|---|---|---|
| Nippon India Small Cap Bonus Fund | 23.4% | 22.83% | 25.81% |
| Nippon India Small Cap Fund | 23.39% | 22.82% | 25.8% |
| SBI Small Cap Fund | 22.69% | 21.62% | 22.72% |
| DSP Small Cap Fund | 18.21% | 18.13% | 22.06% |
| Quant ELSS Tax Saver Fund | 25.4% | 23.74% | 22.03% |
| Kotak Midcap Fund | 19.78% | 19.29% | 21.65% |
| Kotak Small Cap Fund | 21.48% | 20.13% | 21.65% |
| Motilal Oswal Midcap Fund | 16.2% | 17.39% | 21.17% |
| Franklin India Small Cap Fund | 16.33% | 16.93% | 20.79% |
| Invesco India Midcap Fund | 19.45% | 19.25% | 20.68% |
The above table shows the top funds with the highest lump sum returns right now.
How Inflation Changes the Real Value of ₹1 Crore?
Inflation is essential to goal planning in an economy where prices are rising overall. We can use the rule of 72 as a convenient mental shortcut to understanding the impact of inflation.
The rule says: Rate of doubling * Time in years = 72
Rule of 72 lets us quickly calculate the impact of inflation over time. For example, using the rule, we can see that the purchasing power of money halves every ten years at 7% inflation. For example, one crore worth today will be worth around 50 lakhs in 10 years and 25 lakhs in 20 years.
| Years needed to reach 1 cr |
Value of 1cr at 7% inflation (lakhs) |
Value of 1cr at 8% inflation (lakhs) |
Value of 1cr at 9% inflation (lakhs) |
|---|---|---|---|
| 5 | ₹ 71.30 | ₹ 68.06 | ₹ 64.99 |
| 6 | ₹ 66.63 | ₹ 63.02 | ₹ 59.63 |
| 7 | ₹ 62.27 | ₹ 58.35 | ₹ 54.70 |
| 8 | ₹ 58.20 | ₹ 54.03 | ₹ 50.19 |
| 9 | ₹ 54.39 | ₹ 50.02 | ₹ 46.04 |
| 10 | ₹ 50.83 | ₹ 46.32 | ₹ 42.24 |
| 11 | ₹ 47.51 | ₹ 42.89 | ₹ 38.75 |
| 12 | ₹ 44.40 | ₹ 39.71 | ₹ 35.55 |
| 13 | ₹ 41.50 | ₹ 36.77 | ₹ 32.62 |
| 14 | ₹ 38.78 | ₹ 34.05 | ₹ 29.92 |
| 15 | ₹ 36.24 | ₹ 31.52 | ₹ 27.45 |
Therefore investing too conservatively, if the target is to reach the first crore, will make the real value of that ₹1 crore too low to be of much use once finally reached.
Conclusion: How to Create and Manage a Portfolio to Reach ₹1 crore?
We will approach this problem step-by-step:
- Step 1: Understand your risk profile. You can use our free tool here: Do not invest in mutual funds before doing this
- Step 2: Get an estimate of how much you want to invest as lump sum and by when you wish to reach ₹1 crore using the Arthgyaan SIP Calculator for Target Amount
- Step 3: Start SIP in your chosen funds. If the amount you can invest today as SIP is lower than what the calculator shows, start the SIP now and then look at other options to upskill and increase your income
- Step 4: Review the portfolio annually. Enter your current Mutual Fund balance in the lump sum and repeat from Step 2 onwards
Frequently Asked Questions (FAQs)
Can I reach ₹1 crore with a ₹5,000 monthly SIP?
Yes, but only with a long investment horizon spanning decades. Even at 12% annual returns, ₹5,000 per month (with 10% annual step-up) grows to approximately ₹1 crore in about 30 years.
What SIP amount is needed to reach ₹1 crore in 10 years?
At 12% returns and 10% annual step-up, the required SIP is roughly ₹30,594 per month. At 14% returns, it drops to around ₹27,847 per month.
Is a 12% SIP return a realistic expectation?
Over long periods, diversified equity funds in India have historically delivered returns in the 10-15% range, making 12% a common planning assumption. Short-term returns can vary widely and should not be considered for planning.
Can I reach ₹1 crore faster by increasing my SIP every year?
Yes. A step-up SIP strategy, where you increase your SIP by 5-10% annually, significantly reduces the starting SIP required to reach ₹1 crore. It also makes reaching the target of ₹1 crore faster. For example, if you can invest ₹50,000/month at 12% returns then a fixed-SIP can get you to ₹ 1 crore in 14 years, while a 10% step-up will get you there in 11 years for the same starting amount.
Which mutual fund category is best for a ₹1 crore goal?
For long time horizons, diversified funds like multi-asset can be used as the core fund of the portfolio with multiple satellite funds for tactical bets. For short time horizons, debt or some hybrid funds offer less volatility at the cost of taking longer to reach the target.
Is SIP better than a lump sum for reaching ₹1 crore?
A lump sum can reach the goal faster if invested early. However, SIPs reduce timing risk and are easier for most investors to sustain monthly since investors have salary income.
How does inflation affect the ₹1 crore target?
With official inflation at 5-6%, the purchasing power of ₹1 crore will fall over time. The Rule of 72 shows that the value of ₹1 crore will be ₹50 lakhs in 10 years and ₹25 lakhs in 20 years at just 7% inflation.
Can I pause or skip SIPs during financial emergencies while investing to reach a ₹1 crore corpus?
Yes. Most mutual fund platforms allow pausing SIPs without penalty. However, pausing reduces corpus growth and may require a higher SIP later.
Is it possible to reach ₹1 crore with multiple small SIPs in different funds?
Yes. The total monthly investment across funds is what matters. Multiple smaller SIPs diversify the portfolio without affecting the total target corpus. Too many funds however, create clutter that reduces returns and makes it difficult to manage.
How often should I review my SIP for a ₹1 crore goal?
Annual reviews are typical. Adjustments may be needed based on income changes, performance deviations, or changes in your target duration. Use the Arthgyaan SIP Calculator for Target Amount to find out how much you need to still invest based on where you are on your investment journey.
Related Articles
- Investor behaviour: control what is possible
- What is a step-up SIP and how much more wealth does it create vs. a normal SIP?
- Does a step-up SIP provide a higher return than an ordinary SIP?
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